Scottish Government £100.6m short on LBTT predictions

24 Mar 2017

Official figures released by Revenue Scotland and analysed by the Scottish Property Federation (SPF) have shown the Scottish Government’s Land and Building Transaction Tax (LBTT) returns for February 2017 generated the lowest LBTT revenue of any other month in 2016/17.

 

Analysis of the February 2017 figures by SPF highlighted that returns were £31.9m, down from £34.2m in January. According to the figures released by Revenue Scotland, revenue from residential LBTT increased slightly by £0.3m to £20.7m where commercial LBTT decreased to £11.2m - £2.6m less compared to January.

 

The Scottish Government expected to generate £538m from LBTT this tax year meaning an £121m increase on the 2015/16 outturn. Targets are still £100.6m short with just one month left in this tax year.

 

Additional Dwellings Supplement (ADS) were however up slightly with revenue for February totalling £7.4m compared to £7.1m in January. For the year to date £82.7m has been raised. 

David Melhuish, director of the Scottish Property Federation said:

 

“Revenue for February has been the lowest to date for LBTT which will be extremely disappointing for the Scottish Government. £100.6m still has to be raised by next month in order to meet the £538m target set at the beginning of the tax year, a figure we fear will be a struggle.

 

“This isn’t a great surprise as there has been a much lower level of commercial property sales but the evidence from members also tells us that the higher value residential markets continue to struggle across much of the country, so we continue to call for the 10% tax threshold to be raised from £325,000 to £500,000 in order to support greater numbers of transactions at these levels of the market..  The position for the government would be a lot worse without the new additional homes LBTT tax. Without this additional £82.7m, the LBTT figures would be even further from its predicted target.”

 

 

Notes to Editor

LBTT figures from Revenue Scotland can be found here

About Scottish Property Federation

As a membership organisation the Scottish Property Federation (SPF) is the voice of Scotland’s real estate industry.  Established in 2007, SPF represents 185 organisations operating in Scotland.   We include among our members: property investors including major institutional funds, developers, landlords of commercial and residential property, and professional property consultants and advisers.  The SPF works closely with those who advise and decide on public policy in Scotland to ensure that they are aware of the consequences of their decisions for the property industry and wider economy.  

As part of the British Property Federation we also benefit from close links with the leading UK property companies and investors in the UK as well as the BPF's contacts with Westminster.

For more information, please visit http://www.scottishpropertyfederation.org.uk or follow us on Twitter @ScotPropFed.